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2017 (1) TMI 1465 - HC - VAT and Sales TaxClassification of goods - “Shower to Shower” - “Listerine Mouthwash” - “Listerine Cool Mint Mouthwash” - “Savlon” - whether falls within the ambit of drug and medicine or not? - penalty u/s 61 - Held that: - Insofar as “Shower to Shower” and “Listerine Mouth Wash” are concerned, in my view these two products can be used by any person irrespective of prescribing by a medical doctor for one to feel fresh and to avoid/remove body odour or to remove bad smell in body/mouth, and in my view these are products which are freely available in the market and merely because there may be some percentage of acid or ethanol or similar ingredients, it cannot be said that they can be said to be like a medicine or even can be said to be a medicine or a drug - A minor percentage of acid/ethanol which may be available in almost all cosmetics as well, cannot justify the claim as raised by assessee that they have to be classified as drugs/medicine - the claim of the petitioner is required to be rejected and accordingly the petitions insofar as the assessee is concerned, is required to be dismissed. Savlon - Held that: - The Apex Court in the case of ICPA Health Products Pvt. Ltd. v. CCE [2004 (4) TMI 77 - SUPREME COURT OF INDIA] was considering a case of Hexiperp, Hexiscrub (Surgiscrub) and Hexiaque, which also contain Chloral Hex dine Gluconate Solution BP, which is also available in “Savlon” and held it to be a medicine - the finding reached by the Tax Board, in my view, is just and proper and is not required to be interfered with. Penalty u/s 61 - Held that: - Admittedly, it is a case where an issue of classification of entries is there and the issue becomes debatable once the assessee claims that it is a drug/medicine and Revenue may dispute to be falling in the general category or as a cosmetic but at least penalty cannot be levied in such a case. Though it is a case of survey and some material was gathered by the AO during the course of survey but that by itself does not mean that the assessee has concealed the particulars so as to be visited with penalty u/s 61 - The Apex Court as well as this Court have in identical cases held that when there is an issue of classification and issue being debatable, the penalty is not leviable/imposable/sustainable. Appeal allowed - decided partly in favor of appellant and partly in favor of Revenue.
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